FRP HOLDINGS, INC./NEWS
Contact: John D. Milton, Jr.
Chief Financial Officer 904/858-9100
------------------------------------------------------------------------------
FRP HOLDINGS, INC. (NASDAQ: FRPH) ANNOUNCES RESULTS FOR THE SECOND QUARTER AND
SIX MONTHS ENDED JUNE 30, 2019.
FRP Holdings, Inc. (NASDAQ-FRPH) Jacksonville, Florida; August 5, 2019 -
Second Quarter Consolidated Results of Operations
Net income for the second quarter of 2019 was $9,825,000 or $.99 per share
versus $119,982,000 or $11.87 per share in the same period last year. Income
from discontinued operations for the second quarter of 2019 was $6,776,000 or
$.68 per share versus $120,465,000 or $11.92 per share in the same period last
year. Second quarter of 2019 includes $536,000 in pretax profit related to
the sale of our office building at 7030 Dorsey Road. Second quarter of 2018
loss from continuing operations of $879,000 included $1,085,000 in stock
compensation expense ($682,800 for the 2018 director stock grant and $402,000
for vesting of option grants from 2016 and 2017 due to the asset disposition).
The income from discontinued operations in the current year and the prior year
is related to the sale of the Company's industrial warehouse properties in
May 2018. The current year income from discontinued operations includes the
sale to the same buyer of our property at 1502 Quarry Drive for $11.7 million.
This asset was excluded from the original sale due to the tenant potentially
exercising its right of first refusal to purchase the property.
Second Quarter Segment Operating Results
Asset Management Segment:
------------------------
Most of the Asset Management Segment was reclassified to discontinued
operations leaving two commercial properties as well as Cranberry Run, which
we purchased first quarter, and 1801 62nd Street which joined Asset
Management on April 1. Cranberry Run is a five-building industrial park in
Harford County, MD totaling 268,010 square feet of industrial/ flex space and
at quarter end was 32.8% leased and occupied. 1801 62nd Street is our most
recent spec building in Hollander Business Park and is our first warehouse
with a 32-foot clear. We completed construction on this building earlier
this year and are in the process of leasing it up. This quarter we completed
the sale of 7030 Dorsey Road in Anne Arundel County for $8,850,000. It was
one of the three commercial properties remaining from the asset sale last May.
Total revenues in this segment were $662,000, up $94,000 or 16.5%, over the
same period last year. Operating loss was ($11,000), down $160,000 compared
to the same quarter last year due to higher allocation of corporate expenses
as well as increased operating expenses associated with the Cranberry Run
acquisition and the addition of 1801 62nd Street to Asset Management
this quarter.
Mining Royalty Lands Segment:
----------------------------
Total revenues in this segment were $2,633,000 versus $2,055,000 in the same
period last year. Total operating profit in this segment was $2,422,000, an
increase of $556,000 versus $1,866,000 in the same period last year. Among
the reasons for this increase in revenue and operating profit is the
contribution from our Ft. Myers quarry, the revenue from which, now that
mining has begun in earnest, was nearly double the minimum royalty we have
been receiving until recently.
Development Segment:
-------------------
The Development segment is responsible for (i) seeking out and identifying
opportunistic purchases of income producing warehouse/office buildings, and
(ii) developing our non-income producing properties into income production.
With respect to ongoing projects:
* We are fully engaged in the formal process of seeking PUD entitlements
for our 118-acre tract in Hampstead, Maryland, now known as "Hampstead
Overlook." Hampstead Overlook received non-appealable rezoning from
industrial to residential during the first quarter this year.
* We finished shell construction in December 2018 on the two office
buildings in the first phase of our joint venture with St. John
Properties. Shell construction of the two retail buildings was
completed in January. We are now in the process of leasing these four
single-story buildings totaling 100,030 square feet of office and
retail space. At quarter end, Phase I was 44% leased and 8% occupied.
* We are the principal capital source of a residential development
venture in Essexshire known as "Hyde Park." We have committed up to
$9.2 million in exchange for an interest rate of 10% and a preferred
return of 20% after which a "waterfall" determines the split of
proceeds from sale. Hyde Park will hold 122 town homes and four
single-family lots and received a non-appealable Plan Approval during
the first quarter. We are currently pursuing entitlements and have a
home builder under contract to purchase the land upon government
approval to begin development.
* In April 2018, we began construction on Phase II of our RiverFront
on the Anacostia project, now known as "The Maren." We expect to
deliver the building in the first half of 2020.
* In December 2018, the Company entered into a joint venture agreement
with MidAtlantic Realty Partners (MRP) for the development of the
first phase of a multifamily, mixed-use development in northeast
Washington, DC known as "Bryant Street." FRP contributed $32 million
for common equity and another $23 million for preferred equity to the
joint venture. Construction began in February 2019 and should be
finished in 2021. This project is located in an opportunity zone and
could defer a significant tax liability associated with last year's
asset sale.
Stabilized Joint Venture Segment:
--------------------------------
Average occupancy for the quarter was 96.37%, and at the end of the quarter
Dock 79 was 94.44% leased and 97.38% occupied. Net Operating Income this
quarter for this segment was $1,866,000, up $200,000 or 12.00% compared to
the same quarter last year. Dock 79 is a joint venture between the Company
and MRP, in which FRP Holdings, Inc. is the majority partner with 66%
ownership.
Six Months Consolidated Results of Operations.
Net income for first half of 2019 was $11,723,000 or $1.17 per share versus
$121,542,000 or $12.04 per share in the same period last year. Income from
discontinued operations for the first half of 2019 was $6,862,000 or $.69 per
share versus $122,187,000 or $12.10 per share in the same period last year.
The first half of 2018 loss from continuing operations of $1,572,000 included
$1,085,000 in stock compensation expense ($682,800 for the 2018 director stock
grant and $402,000 for vesting of option grants from 2016 and 2017 due to the
asset disposition).
Six Months Segment Operating Results
Asset Management Segment:
------------------------
Most of the Asset Management Segment was reclassified to discontinued
operations leaving one recent industrial acquisition, Cranberry Run, which we
purchased first quarter, 1801 62nd Street which joined Asset Management on
April 1, and two commercial properties after the sale this past quarter of
our office property at 7030 Dorsey Road. Cranberry Run is a five-building
industrial park in Harford County, MD totaling 268,010 square feet of
industrial/ flex space. It is our plan to make $1,455,000 in improvements in
order to re-lease the property for a total investment of $29.35 per square
foot. 1801 62nd Street is our most recent spec building in Hollander Business
Park and is our first warehouse with a 32-foot clear. We completed
construction on this building earlier this year and are in the process of
leasing it up. Total revenues in this segment were $1,303,000, up $154,000
or 13.4%, over the same period last year. Operating loss was ($77,000),
down $472,000 compared to the same period last year due to higher allocation
of corporate expenses and operating expenses associated with the Cranberry
Run acquisition and the addition of 1801 62nd Street to Asset Management
this quarter.
Mining Royalty Lands Segment:
----------------------------
Total revenues in this segment were $4,862,000 versus $3,827,000 in the same
period last year. Total operating profit in this segment was $4,423,000, an
increase of $1,016,000 versus $3,407,000 in the same period last year. Among
the reasons for this increase in revenue and operating profit is the
contribution from our Ft. Myers quarry, the revenue from which, now that
mining has begun in earnest, was more than double the minimum royalty we have
been receiving until recently.
Development Segment:
-------------------
The Development segment is responsible for (i) seeking out and identifying
opportunistic purchases of income producing warehouse/office buildings, and
(ii) developing our non-income producing properties into income production.
With respect to ongoing projects:
* We are fully engaged in the formal process of seeking PUD entitlements
for our 118-acre tract in Hampstead, Maryland, now known as "Hampstead
Overlook." Hampstead Overlook received non-appealable rezoning from
industrial to residential during the first quarter this year.
* We finished shell construction in December 2018 on the two office
buildings in the first phase of our joint venture with St. John
Properties. Shell construction of the two retail buildings was
completed in January. We are now in the process of leasing these four
single-story buildings totaling 100,030 square feet of office and
retail space. At quarter end, Phase I was 44% leased and
8% occupied.
* We are the principal capital source of a residential development
venture in Essexshire known as "Hyde Park." We have committed up to
$9.2 million in exchange for an interest rate of 10% and a preferred
return of 20% after which a "waterfall" determines the split of
proceeds from sale. Hyde Park will hold 122 town homes and four
single-family lots and received a non-appealable Plan Approval
during the first quarter. We are currently pursuing entitlements
and have a home builder under contract to purchase the land upon
government approval to begin development.
* In April 2018, we began construction on Phase II of our RiverFront
on the Anacostia project, now known as "The Maren." We expect to
deliver the building in the first half of 2020.
* In December 2018, the Company entered into a joint venture agreement
with MidAtlantic Realty Partners (MRP) for the development of the
first phase of a multifamily, mixed-use development in northeast
Washington, DC known as "Bryant Street." FRP contributed $32 million
for common equity and another $23 million for preferred equity to the
joint venture. Construction began in February 2019 and should be
finished in 2021. This project is located in an opportunity zone and
could defer a significant tax liability associated with last year's
asset sale.
Stabilized Joint Venture Segment:
--------------------------------
Average occupancy for the first six months was 94.88%, and at the end of the
second quarter Dock 79 was 94.44% leased and 97.38% occupied. Net Operating
Income for this segment was $3,497,000, up $346,000 or 10.98% compared to
the same quarter last year, primarily due to substantial increases in NOI
from our retail tenants compared to this period last year. Dock 79 is a
joint venture between the Company and MRP, in which FRP Holdings, Inc.
is the majority partner with 66% ownership.
Summary and Outlook
With this past quarter's dispositions of our assets at 1502 Quarry Drive and
7020 Dorsey Road for $11.7 million and $8.85 million respectively, the Company
continued and has nearly completed the liquidation of its "heritage"
properties. Of the 43 buildings owned and operated by the Company at the
start of 2018, all that remains is the Company's home office building in
Sparks, MD and the vacant lot in Jacksonville still under lease to Vulcan that
used to house Florida Rock Industries' home office. We are trying to find a
home for the proceeds from these recent sales in both opportunity zone and
like-kind exchange opportunities.
This quarter marked the fifth consecutive quarter of increases in mining
royalty revenue compared to the same period the year before and represents the
segment's best ever six-month start to a fiscal year. To add some further
perspective, the royalties collected through the first six months are more
than what we collected in any year from 2009 through 2014.
Construction remains on schedule for The Maren and Bryant Street, with
delivery expected at The Maren in the first half of 2020. While construction
should be complete at Bryant St in 2021, the first residential unit should be
delivered by the end of 2020. These assets represent an investment of over
$80 million and will more than triple the number of residential units and
square feet of mixed use we have in our existing portfolio.
This quarter Dock 79 reached its highest occupancy rate since this same
quarter last year. Given the growing supply of multi-family in that submarket,
the ability to continue to renew more than half our tenants during the
construction of The Maren next door, while also growing rents speaks to the
premium the market places on this asset's quality and waterfront location.
Finally, in regards to the proceeds from last year's asset sale, we are
actively pursuing different projects in which to put the money to use while
remaining cautious and perhaps conservative in terms of the standard of quality
of any project we consider. We do not expect that our investors will have
unlimited patience as to when this money is put to work, and no one is more
anxious than our management team to return the money to our shareholders in the
form of new investments. However, it must be an investment worth making.
To that end, we have been repurchasing shares of the Company when we believe
it is underpriced. As of June 30, we have repurchased 110,527 shares in 2019
at an average cost of $48.06 per share, and we have received additional
authorization from the board effective today to make a further $10,000,000 in
share repurchases.
Subsequent Events
Subsequent to the end of the quarter, on July 9, we were informed by Cemex
that Lake County issued Cemex a Mine Operating Permit (MOP) for its "4
Corners Mine" on the property it leases from the Company in Lake Louisa.
This is the last of the permits required to begin mining this property.
In addition to completing all the work necessary to prepare the site to
become an active sand mine, as a condition to begin operations, Cemex will
need to complete construction on a road adjacent to the property within the
next 30 months but can begin selling when the road is halfway completed.
Cemex expects to begin mining in earnest and selling by first quarter of 2021.
This permit is the final regulatory hurdle to a process that began with the
purchase of this land in 2012. Once mining begins, Cemex's ability to realize
these reserves should positively impact revenue and income over the term of
the lease as it creates an opportunity to collect more than the minimums from
this location.
Conference Call
The Company will host a conference call on Monday, August 5, 2019 at 1:00
p.m. (EDT). Analysts, stockholders and other interested parties may access
the teleconference live by calling 1-800-311-9406 (passcode 939063) within
the United States. International callers may dial 1-334-323-7224 (passcode
939063). Computer audio live streaming is available via the Internet
through the Company's website at www.frpholdings.com. You may also click on
this link for the live streaming
http://stream.conferenceamerica.com/frp080519. For the archived audio via
the internet, click on the following link
http://archive.conferenceamerica.com/archivestream/frp080519.mp3.
If using the Company's website, click on the Investor Relations tab, then
select the earnings conference stream. An audio replay will be available for
sixty days following the conference call. To listen to the audio replay, dial
toll free 1-877-919-4059, international callers dial 1-334-323-0140. The
passcode of the audio replay is 44184782. Replay options: "1" begins
playback, "4" rewind 30 seconds, "5" pause, "6" fast forward 30 seconds, "0"
instructions, and "9" exits recording. There may be a 30-40 minute delay
until the archive is available following the conclusion of the conference call.
Investors are cautioned that any statements in this press release which relate
to the future are, by their nature, subject to risks and uncertainties that
could cause actual results and events to differ materially from those indicated
in such forward-looking statements. These include, but are not limited to: the
possibility that we may be unable to find appropriate reinvestment
opportunities for the proceeds from the Sale Transaction; levels of
construction activity in the markets served by our mining properties; demand
for flexible warehouse/office facilities in the Baltimore-Washington-Northern
Virginia area demand for apartments in Washington D.C.; our ability to obtain
zoning and entitlements necessary for property development; the impact of
lending and capital market conditions on our liquidity; our ability to finance
projects or repay our debt; general real estate investment and development
risks; vacancies in our properties; risks associated with developing and
managing properties in partnership with others; competition; our ability
to renew leases or re-lease spaces as leases expire; illiquidity of real
estate investments; bankruptcy or defaults of tenants; the impact of
restrictions imposed by our credit facility; the level and volatility of
interest rates; environmental liabilities; inflation risks; cybersecurity
risks; as well as other risks listed from time to time in our SEC filings;
including but not limited to; our annual and quarterly reports. We
have no obligation to revise or update any forward-looking statements, other
than as imposed by law, as a result of future events or new information.
Readers are cautioned not to place undue reliance on such forward-looking
statements.
FRP Holdings, Inc. is a holding company engaged in the real estate business,
namely (i) leasing and management of commercial properties owned by the
Company, (ii) leasing and management of mining royalty land owned by the
Company, (iii) real property acquisition, entitlement, development and
construction primarily for apartment, retail, warehouse, and office,
(iv) leasing and management of a residential apartment building.
FRP HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share amounts)
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2019 2018 2019 2018
------ ------ ------ ------
Revenues:
Lease revenue $ 3,730 3,498 7,215 6,801
Mining lands lease revenue 2,633 2,055 4,862 3,827
--------- ------ ------- ------
Total Revenues 6,363 5,553 12,077 10,628
Cost of operations:
Depreciation, depletion
and amortization 1,472 2,131 2,959 4,529
Operating expenses 910 1,103 1,792 1,968
Property taxes 713 611 1,466 1,286
Management company indirect 610 455 1,202 816
Corporate expenses 551 1,709 1,196 2,388
--------- ------ ------- ------
Total cost of operations 4,256 6,009 8,615 10,987
Total operating profit (loss) 2,107 (456) 3,462 (359)
Net investment income,
including realized gains
of $328, $0, $447 and $0,
respectively 1,984 216 3,794 221
Interest expense (272) (807) (860) (1,650)
Equity in loss of joint ventures (272) (11) (536) (23)
Gain on investment land sold 536 - 536 -
--------- ------ ------- ------
Income (loss) from
continuing operations
before income taxes 4,083 (1,058) 6,396 (1,811)
Provision for (benefit from)
income taxes 1,131 (179) 1,803 (239)
--------- ------ ------- ------
Income (loss) from
continuing operations 2,952 (879) 4,593 (1,572)
Income from discontinued
operations, net 6,776 120,465 6,862 122,187
Net income 9,728 119,586 11,455 120,615
Loss attributable to
noncontrolling interest (97) (396) (268) (927)
--------- ------ ------- ------
Net income attributable
to the Company $ 9,825 119,982 11,723 121,542
========= ======= ======= =======
Earnings per common share:
Income (loss) from
continuing operations-
Basic $ 0.30 (0.09) 0.46 (0.16)
Diluted $ 0.30 (0.09) 0.46 (0.16)
Discontinued operations-
Basic $ 0.68 12.01 0.69 12.19
Diluted $ 0.68 11.92 0.69 12.10
Net income attributable
to the Company-
Basic $ 0.99 11.96 1.18 12.13
Diluted $ 0.99 11.87 1.17 12.04
Number of shares (in
thousands) used in computing:
-basic earnings per
common share 9,915 10,033 9,933 10,024
-diluted earnings per
common share 9,960 10,109 9,987 10,099
FRP HOLDINGS, INC. AND SUBSIDIARIES
-----------------------------------
CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except share data)
June 30 December 31
2019 2018
----------- -----------
Assets:
Real estate investments at cost:
Land $ 84,383 83,721
Buildings and improvements 144,779 144,543
Projects under construction 2,508 6,683
----------- -----------
Total investments in properties 231,670 234,947
Less accumulated depreciation and depletion 27,472 28,394
----------- -----------
Net investments in properties 204,198 206,553
----------- -----------
Real estate held for investment, at cost 7,167 7,167
Investments in joint ventures 94,937 88,884
----------- -----------
Net real estate investments 306,302 302,604
----------- -----------
Cash and cash equivalents 56,169 22,547
Cash held in escrow 20,066 202
Accounts receivable, net 783 564
Investments available for sale at fair value 122,183 165,212
Federal and state income taxes receivable 27,206 9,854
Unrealized rents 459 53
Deferred costs 645 773
Other assets 463 455
Assets of discontinued operations 871 3,224
----------- -----------
Total assets $ 535,147 505,488
=========== ===========
Liabilities:
Secured notes payable $ 88,857 88,789
Accounts payable and accrued liabilities 2,044 3,545
Environmental remediation liability 92 100
Deferred revenue 858 27
Deferred income taxes 50,439 27,981
Deferred compensation 1,446 1,450
Tenant security deposits 252 53
Liabilities of discontinued operations 158 288
----------- -----------
Total liabilities 144,146 122,233
----------- -----------
Commitments and contingencies
Equity:
Common stock, $.10 par value
25,000,000 shares authorized,
9,963,451 and 9,969,174 shares issued
and outstanding, respectively 986 997
Capital in excess of par value 57,562 58,004
Retained earnings 313,373 306,307
Accumulated other comprehensive income, net 1,210 (701)
----------- -----------
Total shareholders' equity 373,131 364,607
Noncontrolling interest MRP 17,870 18,648
----------- -----------
Total equity 391,001 383,255
----------- -----------
Total liabilities and shareholders' equity $ 535,147 505,488
=========== ===========
Asset Management Segment:
------------------------
Three months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Lease revenue $ 662 100.0% 568 100.0% 94 16.5%
Depreciation, depletion and amortization 196 29.6% 129 22.7% 67 51.9%
Operating expenses 175 26.5% 91 16.0% 84 92.3%
Property taxes 90 13.6% 40 7.1% 50 125.0%
Management company indirect 73 11.0% 50 8.8% 23 46.0%
Corporate expense 139 21.0% 109 19.2% 30 27.52%
-------- ------- -------- ------- -------- -------
Cost of operations 673 101.7% 419 73.8% 254 60.6%
-------- ------- -------- ------- -------- -------
Operating profit $ (11) -1.7% 149 26.2% (160) -107.4%
======== ======= ======== ======= ======== =======
Mining Royalty Lands Segment:
----------------------------
Three months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Mining lands lease revenue $ 2,633 100.0% 2,055 100.0% 578 28.1%
Depreciation, depletion and amortization 42 1.6% 36 1.8% 6 16.7%
Operating expenses 15 0.6% 40 1.9% (25) -62.5%
Property taxes 69 2.6% 61 3.0% 8 13.1%
Management company indirect 49 1.9% - 0.0% 49 0.0%
Corporate expense 36 1.4% 52 2.5% (16) -30.8%
-------- ------- -------- ------- -------- -------
Cost of operations 211 8.0% 189 9.2% 22 11.6%
-------- ------- -------- ------- -------- -------
Operating profit $ 2,422 92.0% 1,866 90.8% 556 29.8%
======== ======= ======== ======= ======== =======
Development Segment:
-------------------
Three months ended June 30
--------------------------------------
(dollars in thousands) 2019 2018 Change
-------- -------- --------
Lease revenue $ 316 317 (1)
Depreciation, depletion and amortization 49 57 (8)
Operating expenses 95 367 (272)
Property taxes 295 231 64
Management company indirect 442 292 150
Corporate expense 341 283 58
-------- -------- --------
Cost of operations 1,222 1,230 (8)
-------- -------- --------
Operating loss $ (906) (913) 7
======== ======== ========
Stabilized Joint Venture Segment:
--------------------------------
Three months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Lease revenue $ 2,752 100.0% 2,613 100.0% 139 5.3%
Depreciation, depletion and amortization 1,185 43.0% 1,909 73.1% (724) -37.9%
Operating expenses 625 22.7% 605 23.1% 20 3.3%
Property taxes 259 9.4% 279 10.7% (20) -7.2%
Management company indirect 46 1.7% 113 4.3% (67) -59.3%
Corporate expense 35 1.3% 95 3.6% (60) -63.2%
-------- ------- -------- ------- -------- -------
Cost of operations 2,150 78.1% 3,001 114.8% (851) -28.4%
-------- ------- -------- ------- -------- -------
Operating profit $ 602 21.9% (388) -14.8% 990 -255.2%
======== ======= ======== ======= ======== =======
Asset Management Segment:
------------------------
Six months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Lease revenue $ 1,303 100.0% 1,149 100.0% 154 13.4%
Depreciation, depletion and amortization 373 28.6% 260 22.6% 113 43.5%
Operating expenses 384 29.5% 229 19.9% 155 67.7%
Property taxes 146 11.2% 79 6.9% 67 84.8%
Management company indirect 175 13.4% 74 6.5% 101 136.5%
Corporate expense 302 23.2% 112 9.7% 190 169.6%
-------- ------- -------- ------- -------- -------
Cost of operations 1,380 105.9% 754 65.6% 626 83.0%
-------- ------- -------- ------- -------- -------
Operating profit $ (77) -5.9% 395 34.4% (472) -119.5%
======== ======= ======== ======= ======== =======
Mining Royalty Lands Segment:
----------------------------
Six months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Mining lands lease revenue $ 4,862 100.0% 3,827 100.0% 1,035 27.0%
Depreciation, depletion and amortization 94 1.9% 90 2.4% 4 4.4%
Operating expenses 31 0.7% 80 2.1% (49) -61.3%
Property taxes 137 2.8% 121 3.2% 16 13.2%
Management company indirect 98 2.0% - 0.0% 98 0.0%
Corporate expense 79 1.6% 129 3.3% (50) -38.8%
-------- ------- -------- ------- -------- -------
Cost of operations 439 9.0% 420 11.0% 19 4.5%
-------- ------- -------- ------- -------- -------
Operating profit $ 4,423 91.0% 3,407 89.0% 1,016 29.8%
======== ======= ======== ======= ======== =======
Development Segment:
-------------------
Six months ended June 30
--------------------------------------
(dollars in thousands) 2019 2018 Change
-------- -------- --------
Lease revenue $ 585 614 (29)
Depreciation, depletion and amortization 107 114 (7)
Operating expenses 141 475 (334)
Property taxes 618 499 119
Management company indirect 837 533 304
Corporate expense 740 702 38
-------- -------- --------
Cost of operations 2,443 2,323 120
-------- -------- --------
Operating loss $ (1,858) (1,709) (149)
======== ======== ========
Stabilized Joint Venture Segment:
--------------------------------
Six months ended June 30
---------------------------------------
(dollars in thousands) 2019 % 2018 % Change %
-------- ------- -------- ------- -------- -------
Lease revenue $ 5,327 100.0% 5,038 100.0% 139 5.7%
Depreciation, depletion and amortization 2,385 44.8% 4,065 80.7% (1,680) -41.3%
Operating expenses 1,236 23.2% 1,184 23.5% 52 4.4%
Property taxes 565 10.6% 587 11.7% (22) -3.7%
Management company indirect 92 1.7% 209 4.1% (117) -56.0%
Corporate expense 75 1.4% 237 4.7% (162) -68.4%
-------- ------- -------- ------- -------- -------
Cost of operations 4,353 81.7% 6,282 124.7% (1,929) -30.7%
-------- ------- -------- ------- -------- -------
Operating profit $ 974 18.3% (1,244) -24.7% 2,218 -178.3%
======== ======= ======== ======= ======== =======
FRP HOLDINGS, INC. AND SUBSIDIARIES
DISCONTINUED OPERATIONS
(In thousands except per share amounts)
(Unaudited)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2019 2018 2019 2018
------ ------ ------ ------
Revenues:
Lease revenue 222 4,110 460 11,657
Cost of operations:
Depreciation, depletion
and amortization 12 1,217 41 3,102
Operating expenses 139 464 234 1,642
Property taxes 26 449 46 1,247
Management company indirect - 812 - 990
Corporate expenses - 655 - 1,402
--------- ------ ------- ------
Total cost of operations 177 3,597 321 8,383
Total operating profit 45 513 139 3,274
Interest expense - (187) - (587)
Gain on sale of buildings 9,245 164,807 9,268 164,807
--------- ------ ------- ------
Income before income taxes 9,290 165,133 9,407 167,494
Provision for income taxes 2,514 44,668 2,545 45,307
--------- ------ ------- ------
Income from
discontinued operations $ 6,776 120,465 6,862 122,187
========= ====== ======= ======
Earnings per common share:
Income from
discontinued operations-
Basic 0.68 12.01 0.69 12.19
0.68 11.92 0.69 12.10
Non-GAAP Financial Measures.
To supplement the financial results presented in accordance with GAAP, FRP
presents certain non-GAAP financial measures within the meaning of Regulation
G promulgated by the Securities and Exchange Commission. The non-GAAP
financial measure included in this quarterly report is net operating income
(NOI). FRP uses this non-GAAP financial measure to analyze its continuing
operations and to monitor, assess, and identify meaningful trends in its
operating and financial performance. This measure is not, and should not be
viewed as, a substitute for GAAP financial measures.
Net Operating Income Reconciliation
Six months ended 6/30/19 (in thousands)
Stabilized
Asset Joint Mining Unallocated FRP
Management Development Venture Royalties Corporate Holdings
Segment Segment Segment Segment Expenses Totals
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) from continuing
operations 335 (1,347) 25 3,211 2,369 4,593
Income Tax Allocation 124 (499) 109 1,190 879 1,803
---------- ---------- ---------- ---------- ---------- ----------
Income(loss) from continuing
operations before income taxes 459 (1,846) 134 4,401 3,248 6,396
Less:
Gains on sale of buildings 536 - - - - 536
Unrealized rents - - 29 - - 29
Interest income - 526 - - 3,268 3,794
Plus:
Unrealized rents 3 - - 228 - 231
Equity in loss of Joint Venture - 514 - 22 - 536
Interest Expense - - 840 - 20 860
Depreciation/Amortization 373 107 2,385 94 - 2,959
Management Co. Indirect 175 837 92 98 - 1,202
Allocated Corporate Expenses 302 740 75 79 - 1,196
---------- ---------- ---------- ---------- ---------- ----------
Net Operating Income 776 (174) 3,497 4,922 - 9,021
Net Operating Income Reconciliation
Six months ended 6/30/18 (in thousands)
Stabilized
Asset Joint Mining Unallocated FRP
Management Development Venture Royalties Corporate Holdings
Segment Segment Segment Segment Expenses Totals
---------- ---------- ---------- ---------- ---------- ----------
Income from continuing operations 288 (1,247) (2,362) 2,469 (720) (1,572)
Income Tax Allocation 107 (462) (532) 915 (267) (239)
Income from continuing
operations before income taxes 395 (1,709) (2,894) 3,384 (987) (1,811)
Less:
Unrealized rents - - 116 - - 116
Interest income - - - - 221 221
Plus:
Unrealized rents 29 - - 241 - 270
Equity in loss of Joint Venture - - - 23 - 23
Interest Expense - - 1,650 - - 1,650
Depreciation/Amortization 260 114 4,065 90 - 4,529
Management Co. Indirect 74 533 209 - - 816
Allocated Corporate Expenses 112 702 237 129 1,208 2,388
---------- ---------- ---------- ---------- ---------- ----------
Net Operating Income (loss) 870 (360) 3,151 3,867 - 7,528